It’s not hard to define total quality management because it’s exactly that: controlling all aspects of a product’s quality. When an entire company, from the executive managers all the way down to the front-line workers, cares about a product’s quality — and not just maintaining it but constantly improving it — that is total quality management at work. Implementing total quality management requires far more than lip service, and it needs a total buy-in throughout all levels of employees as well as support from the corporate bottom line too.
Under total quality management, every aspect of a company can theoretically be improved for the benefit of the consumer. By having the best product with the best service, the feeling is that a company is bound to be among the best because it will deliver a good consumer experience. Such high-quality, consumer-focused products and services tend to bring better word of mouth and better brand loyalty while also lowering product returns and warranty-related expenses.
Companies that practice TQM are continuously seeking to find and reduce or purge errors in how and what they manufacture. They are constantly streamlining their supply chain management to make distribution both simpler and more cost effective. They also invest heavily in human resource management by keeping employees highly trained and forever improving their human-side processes and efficiencies. All of this is slave to the goal of improving the customer experience.
There are eight founding principles behind a successful TQM program.
- TQM is customer focused. From product design to distribution and everything in between, it is all done with the customer experience in mind. The goal is total satisfaction, encouraging word of mouth recommendations and greater consumer loyalty.
- Employees believe in TQM. Companies must empower their employees to deliver great service and perform to their best abilities in all other capacities at work as well. They have to want to make a great product, and they must take pride in doing their jobs for TQM to truly succeed.
- TQM depends on processes. Through creating consistent processes, consistent results will happen regardless of who is involved. Consider companies like McDonald’s, where the automated aspect means everything is process oriented, and following the script means delivering a consistent product and a consistent experience.
- TQM is completely integrated. A company is a machine with every part all geared toward one outcome: total quality and a satisfied customer. Every person needs to buy into that goal, and every process needs to work toward it.
- Systematic, strategic and focused. TQM requires that any strategic planning the company does has to be focused on having quality control be a core component in the plan.
- TQM means constant improvement. Whether it is finding a way to make shipments lighter to increase profit or lower prices or it is making the product last longer or feel tougher, TQM means everyone is always looking for ways to make the company, product and customer experience better. It’s about keeping stakeholders happy too.
- TQM is data driven. Under TQM, decisions cannot be made without data. It is a fact-based, objective decision made on performance. Data collected needs to be analyzed and reviewed so the company can always find ways to improve.
- Communication is critical. With TQM, communication is open and ongoing. Communication is how everyone is kept on the same page regarding timelines, milestones, strategies and methods.
A leading early example of TQM at work is Japanese auto manufacturer Toyota. Like most of Japan, companies like Toyota churned out lousy products after World War II, and “Made in Japan” was becoming the punchline of a bad joke. Companies banded together to try to change the country’s reputation and adopted statistical quality control, developed by Dr. W. Edwards Deming. It was sort of based on random inspections, but Deming worked with 1950s Japanese manufacturers to implement a system, and by the 1970s, it slowly evolved into what is now called TQM.
Toyota bought into the system and embraced the mentality of TQM, which asserted that a product will meet or exceed the consumer’s expectations. Japanese products began improving, so much so that spotting “Made in Japan” began raising consumer expectations. The Japanese adherence to quality was believed to be the driving factor in how Japan’s post-war demolished economy rose to that of an economic juggernaut in just four decades. Some of that success was thanks to the timely energy crisis of 1973, which prompted Americans to take note of fuel-efficient cars being cranked out by the likes of Toyota and Honda, all carrying that expectation of total quality for which Japan had become noted.
Other companies that benefited from using TQM are Ford, Motorola, Xerox (IKON) and Tata Steel.
Three types of TQM that are relevant and widely used include:
- ISO 9000: Created by the International Organization for Standardization, ISO 9000 focuses on people and leadership while also ensuring that products meet a minimum standard of quality and usefulness so consumers can have expectations met by their purchase.
- Lean Manufacturing: Practiced by Toyota and other companies, this is a process focused on minimizing waste while increasing value.
- Six Sigma: Developed by Motorola, this method is focused on process and efficiencies. It looks to eliminate process flaws that result in defects or inconsistencies.
The godfather of quality, W. Edwards Deming, had 14 points for implementing TQM in a company. Consider this variation of those points:
- Make a constant goal of improving products and services.
- Ensure that everyone adopts this new philosophy.
- Stop having inspections be the reason for producing quality.
- Stop awarding business based on pricing and instead reduce prices by negotiating a single, quality-consistent supplier.
- Always be improving processes in production, planning and customer service.
- Be dedicated to on-the-job training and constant human resource development.
- Prioritize strong leadership throughout the entire chain of command.
- Don’t use fear to lead or command. Employees should not be fearful but instead should feel supported and valued.
- Eliminate barriers among staff areas to build camaraderie and morale.
- Nix sloganeering and targets in the workplace and instead focus on doing work well.
- Ditch the dollar/number-based goals for management and the quotas game in the workforce’s output.
- Create systems that allow for employees to embrace the pride of workmanship but also eliminate merit systems.
- Encourage continuing education and self-improvement among everyone.
- Ensure that everyone has a role to play in achieving the total quality management transformation.
While the methods may change from company to company, those that focus on delivering quality products and services are those that have less of an uphill battle in the marketplace. There are some debates about whether TQM is sustainable in companies with cash flow problems, but others would argue that sacrificing quality to pad the revenue stream is nothing but a race to the bottom.